IRA Transfer

DEFINITION of 'IRA Transfer'

The transfer of funds from an Individual Retirement Account (IRA) to another type of retirement account or bank account. IRA transfers are split into two categories: direct and indirect. A direct transfer involves moving the assets, such as stocks and mutual funds, currently held in an IRA account and moving them to a different account without liquidating them. An indirect transfer involves liquidating the assets in the current IRA account and using the cash to open another IRA account.


Typically, an IRA transfer is from one IRA account to another. Because the use of IRA assets has tax implications, investors may be taxed if funds are withdrawn and not reinvested. Investors using the indirect method are given a fixed period of time, usually 60 days, in which the funds have to be invested in a new IRA before taking a tax hit.